Supplemental Insurance – Supporting Your Medical Cost-Sharing Plan

Medical cost-sharing groups, also called health-sharing ministries, have been in existence for more than 30 years.  For members of these groups, sharing health care costs with other members who hold similar faith and lifestyle values, especially when paired with an affordable supplemental insurance plan, can be a reasonable alternative to purchasing traditional major medical health insurance.

When members join a medical cost-sharing group, they select an amount of their medical costs that they must pay personally before the remainder of the medical costs may be shared by the group (similar to an insurance deductible).  But depending on which ministry you join, the amount may either be annual, or per medical incident.  Supplemental insurance coverage, which provides you cash benefits, can provide valuable financial protection for the gap between your personal responsibility amount and the commencement of cost-sharing benefits.   Thanks to the flexibility of supplemental health insurance cash benefits, you may choose to use those payments for any expense you incur due to a serious illness or accident.  Further, supplemental health insurance is guaranteed issue, meaning that you won’t be turned away for coverage.     

Supplemental health insurance from Pivot Health provides you many additional non-insurance benefits, which may work well with your medical cost-sharing membership, such as:

• Unlimited access to discounted telehealth doctor consultations.  Connect directly with a doctor at whatever time of day works for you – telehealth is available 24/7.  Especially for medical-cost sharing programs that require you to meet a certain dollar amount per incident before cost sharing begins, telehealth can save you money, compared to a standard office or urgent care facility visit.
• Savings on eye care and eyewear.  Vision expenses are typically not covered under faith-based health-sharing ministries.  Pivot Health’s discounts of 15 percent to 40 percent on eye exams, eyeglass lenses, frames for eyeglasses and contact lenses, make it easy and affordable to maintain good eye health.  

• Discounts on prescription drugs.  Members of health-sharing ministries are encouraged to take charge of their health care and be responsible consumers, knowing that other members are helping share in their expenses.  Savings of up to 75 percent on prescription drugs at thousands of pharmacies across the nation support your health care accountability goals.

When Did Medical Cost-Sharing Plans Start?

Anabaptist Christians (Amish-Mennonite) have practiced the tradition of medical cost sharing for decades.  The program grew beyond that faith community in the early 1980s, when a pastor in Ohio was involved in a serious car accident.  When word of his accident spread, many who knew of his ministry to alcoholics and drug addicts joined together to pay his medical bills.  After recovering, that pastor formed the first modern faith-based health-sharing ministry group.  Most medical cost-sharing plans today are based on that model.

How Do Medical Cost-Sharing Plans Work?

Currently, all health-sharing societies operating in the U.S. are faith-based.  Applicants are asked to attest to a declaration of faith, as well as disclose pre-existing condition information during the application process.  In addition, some groups also require you to attend church regularly or receive an endorsement from an ecclesiastical leader.  Some programs offer several options, such as various monthly member contribution rates (akin to a monthly premium), personal responsibility amounts (like a deductible), and maximum limits of costs that may be shared for each medical incident, or annually.  Others have a flat personal responsibility amount and varying monthly member contribution rates.

When you visit your doctor and are asked for your insurance card, you ask your provider to submit their charges as indicated on your membership card.  Many of the cost-sharing groups will negotiate on your behalf and pay amounts eligible for cost-sharing within a month.  Members are also encouraged to tell their provider that they are “self-pay patients” – many times, providers are willing to negotiate pricing for these patients.  In turn, the health-sharing ministry may credit the negotiated price towards the member’s personal responsibility amount.

Members understand that costs related to medical incidents arising from prohibited behaviors (such as using drugs, abusing alcohol or legal prescription medications, abstaining from tobacco, etc.), are not eligible for sharing.  Health-sharing ministries can become self-selecting groups in which members are usually in good health and engage in healthy lifestyles.  These lifestyle choices may help lower health care expenses, which keep member monthly contributions lower than premiums for traditional major medical insurance, as well as keeping medical expenses lower for the group overall.

What Are the Benefits of Medical Cost-Sharing Plans?

In addition to a lower monthly contribution cost (compared to a monthly health insurance premium), and a self-selecting group of people that commit to engaging in like-minded, Christian, healthy behaviors, medical cost-sharing societies tout numerous benefits:

• Ascribing to Biblical principles.  One of the reasons that health-sharing ministries were formed was to practically demonstrate “bearing one another’s burdens” as described in the Bible.  Beyond other group members helping share your medical costs, you may also receive prayers and good wishes directed your way when you are experiencing an illness or recuperating from an accident.  Although your personal medical information is protected by privacy laws, members who help share in your health care costs receive a notice that you are experiencing a medical situation.  
• No provider network restrictions.  Most health-sharing ministries allow members to freely choose the doctor and hospital they want to use, rather than being limited to providers connected to a specific insurance network.  However, one medical cost-sharing group, MediShare, does have a preferred network program.
• Incentives for maintaining healthy behaviors.  Some of the established health ministries also offer incentives for engaging in healthy lifestyles.  They may provide discounts for health club memberships, or reduced monthly contribution rates for members who meet health incentive standards based on waist measurement, BMI and blood pressure.  
• An exemption from the Affordable Care Act individual mandate.  Medical cost-sharing groups have been around for decades.  However, participation in them has soared since the ACA was passed in 2010, with enrollment figures now estimated at 500,000 to 600,000 Americans, and growing.  Although health-sharing ministries are not insurance companies, members of the group receive an exemption from the ACA requirement to have health insurance or pay a yearly fine.  
• Low administrative costs.  All approved medical-cost sharing programs are not-for-profit 501(c)(3) organizations.  These groups typically have lower administrative costs to run the program, which means that more of your monthly contribution is being directed to medical cost-sharing, rather than towards the costs of running the ministry.

The Downside of Medical Cost-Sharing Groups

For all the benefits cited by satisfied members, critics have pointed out some areas of real concern surrounding health-sharing ministries, such as:

• No regulation for medical cost-sharing groups. Unlike traditional insurance companies, which must follow state and federal guidelines, health-sharing ministries have no such regulations.  Although many perform annual audits as a sound business practice, members have no recourse if the ministry runs out of money.  People interested in joining a medical cost-sharing group should carefully research an organization’s history and member reviews.
• Claims are not guaranteed to be paid.  Many medical cost-sharing groups have an administrative board which determines whose health care costs will be shared and how they will be paid.  In cases of disagreement (where a member believes that costs which were denied should be shared), most groups offer an appeals process.  However, if sharing is ultimately denied, members are not allowed to sue their health-sharing ministry, and there is no insurance commissioner to whom the unhappy member can appeal.  Proponents of medical cost-sharing groups point out that insurance companies may deny claims based on a policy’s “fine print”, but insureds do have resources available to pursue action against an insurance company.
• Negative impact on overall health insurance market.  Industry experts have voiced concern that the sudden growth of health-sharing ministry participation could threaten the individual health care coverage market.  With members of medical cost-sharing groups tending to be healthier because they generally abstain from risky behavior, that leaves fewer healthier individuals participating in the health insurance market, to balance costs for sicker people.  However, advocates of health-sharing ministries say that their members comprise less than 2 percent of the total health insurance market – too small a figure to impact the industry.
• Maximum sharing limits.  Most medical cost-sharing programs outline a maximum amount that may be paid per medical incident, which may be significantly below costs that could be incurred due to a serious illness or accident.  Although some of the established ministries also provide optional programs to which members may contribute to receive higher amounts in case of a medical catastrophe, not all cost-sharing programs offer this choice.  
• Sharing restrictions and limitations for pre-existing conditions.  One of the most popular features of the Affordable Care Act is that insurance companies no longer have the right to refuse you coverage or charge you extra for a pre-existing medical condition.  However, medical cost-sharing groups are not considered insurance companies, and therefore, not subject to these regulations.  Some of the health sharing ministries will cover pre-existing conditions on a sliding cost-sharing scale, or may require a higher monthly contribution amount.  If no costs are incurred related to that condition for a period of three years, many of the medical cost-sharing groups will consider the condition no longer pre-existing.  But health-sharing ministry critics are concerned that individuals will forgo needed treatment for pre-existing conditions to avoid cost-sharing penalties, thus making their conditions even worse.
• Requirement to follow Christian-supported behavior.  Faith-based medical cost-sharing programs are not for everyone.  The programs include strict limitations on smoking, drinking, prescription medication usage, pre- and extra-marital sex, and many other behaviors.  Medical costs incurred due to these and other prohibited lifestyle choices will not be shared.  For many people, these behavior requirements may prove to be too restrictive.  

Is Joining a Medical Cost-Sharing Group the Right Choice for You?

If you are considering joining a faith-based health-sharing ministry, there are a few key considerations to keep in mind.  First, you are attesting to certain faith doctrines, and committing to healthy lifestyle behaviors that conform to those Christian principles.  Second, supplemental health insurance coverage can be a valuable financial resource for helping cover your medical expenses that won’t be shared under the terms of your medical cost-sharing group.  And finally, health-sharing ministries are not insurance companies, and therefore, not subject to the same regulations and industry requirements.  It’s a good idea to compare the pros and cons of medical cost-sharing groups and health insurance coverage for your situation.